The U.S. West Texas Intermediate crude futures settled at $20.09/gallon, its lowest level since February 2002, and actually dipped below $20.00/gallon during trading. This makes a mess for blending economics for biofuel use. But there is a bigger problem – or two. First, the bearish oil price is based on collapsed (global) fuel demand and the RFS which mandates biofuel blending is based on volume. Previous oil price drops have been withstood because supply driven oil and gasoline price drops have led to increases in fuel use, and the RINs credits are the implicit support mechanism to biofuel prices. This time, however, is more analogous to the post 9/11 situation where travel and thus fuel use came to a standstill, but that was befor...
Key Takeaways: Dry bulk markets remain mixed with Capesize vessels seeing continued pressure from weaker demand while fixtures and rate strength gradually increases towards the smaller vessel classes. Tanker markets are pulling back from their recent highs as tonnage moves out of the Mid...
The Trump import plan for 300,000 MT of beef supplies used for ground beef, i.e., lean trim, from September through November has, according to Secretary Brooke Rollins, brought some relief to beef prices. The Executive Order states that the Secretary of Agriculture will analyze and review the m...
Key Takeaways: Texas illustrates the assumptions underlying the 2025 FMMO reform; Idaho exposes their limitations. The Southwest order blend (roughly 27 percent Class I, 32 percent Class III and 31 percent Class IV) exposes Texas producers to every lever USDA adjusted, with a near-neutral proj...
From WPI Consulting
Communicating importance of value-added products
Facing increasing pressure to quantify the value of export promotion efforts to investors, a U.S. industry organization retained WPI to develop a quantitative model that better communicated the importance of exports. The resulting model concluded that value-added meat exports contributed $0.45 cents per bushel to the price of corn, increasing support for that sector’s financial support of WPI’s client. In addition to serving the red meat industry with this type of analysis, WPI has generated similar deliverables for the U.S. soybean and poultry/egg industries.